Anyone seen the exchange rate this morning?

[NickP]

Q, you really are full of the proverbial, any excuse to knock the UK,  another nail in the coffin?  It was you who awhile ago was forecasting the Euro and the Pound to be at parity. Sounds to me like you're whistling in the dark my old mate  "but then July, August and Sept are always rather full and booked well in advance."

 

I would think that as mod you would be better off trying to explain to the members of this forum about the cock up taking place on here at the moment.

[Rabbie]

In the words of Corporal Jones "Don't panic". The rise in interest rates was stated yesterday to be small and gradual. A 0.25%  rise has been suggested for December/January and then further rise to take the rate to 2.5% by 2020. Mind you with the inflation rate announced earlier this week of 0% there may be no need to raise the rate as much as this.

2.5% seems pretty low to me when I remember rates of up to 15% in the early nineties.

[Quillan]

[quote user="NickP"] 

I would think that as mod you would be better off trying to explain to the members of this forum about the cock up taking place on here at the moment.

[/quote]

I don't have a clue what you are talking about.

[Quillan]

[quote user="NickP"]Q, you really are full of the proverbial, any excuse to knock the UK,  another nail in the coffin?  It was you who awhile ago was forecasting the Euro and the Pound to be at parity. Sounds to me like you're whistling in the dark my old mate  "but then July, August and Sept are always rather full and booked well in advance." 

[/quote]

Gosh that was quicker than usual, your sooooo predictable and easy. You must be sitting by your computer 24/7 waiting for me to post. I promise not to disapoint you.

[Frederick]

Rabbie wrote : I remember the rates of 15% in the early nineties . Me too and as Glydis Knight said then

Can it be that it was all so simple then

Or has time rewritten every line

And if we had the chance to do it all again

Tell me

Would we

Could we

[WJT]

[quote user="mint"]Speaking for myself, WJT, I'll just fix on a rate that I am happy with and then I'd change.

For example, I bought a new kitchen.  It was on the upper level of the sum I had in mind.  So............the kitchen cost X euros and I set a realistic figure in pounds.

I put the amount in pounds in the FX account and, as soon as the amount in euros was reached, I changed.

If I'd waited, I'd be getting a few hundred euros more but, at the time a few weeks ago, when grexit was excitedly discussed, I could have got less than the amount I needed for the kitchen.

You take a chance but you try and limit the downside to something approaching acceptable to you.

[/quote]

Thank you Mint, I think that is a good idea. :)

Frederick, not sure I would want to see what would happen all around me but from a personal point of view 15% interest rates would be brilliant!!! :)

[NickP]

[quote user="Quillan"]

Gosh that was quicker than usual,

your sooooo predictable and easy. You must be sitting by your computer

24/7 waiting for me to post. I promise not to disapoint you.

[/quote]

Sorry to disappoint you old chap, but no one waits for the bullshite you

post. [:D]  I thought you would be making the beds or washing up, so what

happened didn't they turn up? still keep telling yourself that your

doing alright and all of the UK is wrong and you'll start to believe it ,

although you probably already do.

 As for you don't know what I

was talking about, then I suggest you read some of the other members

posts about this crap upgrade, but as usual you will carry on ignoring

what is going on,  and continue boring us all to death with your 

pontifications.

[Quillan]

[quote user="NickP"][quote user="Quillan"]

Gosh that was quicker than usual,

your sooooo predictable and easy. You must be sitting by your computer

24/7 waiting for me to post. I promise not to disapoint you.

[/quote]

Sorry to disappoint you old chap, but no one waits for the bullshite you

post. [:D]  I thought you would be making the beds or washing up, so what

happened didn't they turn up? still keep telling yourself that your

doing alright and all of the UK is wrong and you'll start to believe it ,

although you probably already do.

 As for you don't know what I

was talking about, then I suggest you read some of the other members

posts about this crap upgrade, but as usual you will carry on ignoring

what is going on,  and continue boring us all to death with your 

pontifications.[/quote]

See that’s what I mean. I am far more intelligent than you which is why you

can be played like a fiddle without resulting to insults unlike yourself.

Anyway I shall put my fishing rod away for the night and have another go tomorrow

and see if you bite again.

P.S. This forum is a commercial operation and if

you don’t like the adverts then go somewhere else, it really is that simple.

Nobody forces you to post here so why not just leave?

[lindal1000]

Actually I think Quillan has a point re the UK economy... not that I'm bothered as I feel like I'm getting an unexpected bonus at the moment by paying for as much as possible from my UK funds. Suddenly France seems remarkably cheap.. long may it continue..However I do think that UK may be a bit worried. I can't think of much that the UK exports to Europe that would be much affected by a strong pound, but imports from the rest of the EU, will certainly cost more. We've been trying to think of any large purchases we need to make in France in the near future, as there are bargains to be had if you are paying with Sterling at the moment.

[Chancer]

For the first ever time I have a hedge against the currency movements by having income in both £'s and €'s but as the € income is currently 40% more then the £ income I would prefer the £ to be weaker, come la rentrée when I revert to long term lets if the exchange rate remains then I will have pretty much equal incomes from both countries.

I am now in the position of having too much money in my French current account which doesnt pay interest, it would be daft to transfer if to the UK altgough easy to do so, what simple interest bearing accounts are there in France? Something that has never been of any interest to me for a decade and comes as quite a surprise, not something I had ever considered or planned for.

[JohnFB]

Livret A, Tax free no need to declare, Max 22950.00€. All banks have one as its Gov inspired.

JFB

[NickP]

[quote user="Quillan"] [

See that’s what I mean. I am far more intelligent than you which is why you

can be played like a fiddle without resulting to insults unlike yourself.

Anyway I shall put my fishing rod away for the night and have another go tomorrow

and see if you bite again.

P.S. This forum is a commercial operation and if

you don’t like the adverts then go somewhere else, it really is that simple.

Nobody forces you to post here so why not just leave?

[/quote]

Dear oh dear, it's nothing to do with the adverts my dear boy; which have always been on here, it's the format. I enjoy posting here and shall continue to do so in spite of you and your attitude, which  quite frankly stinks; and is childish.  Anyway the forum can't afford to lose anymore members or you wont have anything to moderate on; or have a platform to attempt to display  your so called superior intelligence. [:P]

[Quillan]

[quote user="lindal1000"]Actually I think Quillan has a point re the UK economy... not that I'm bothered as I feel like I'm getting an unexpected bonus at the moment by paying for as much as possible from my UK funds. Suddenly France seems remarkably cheap.. long may it continue..However I do think that UK may be a bit worried. I can't think of much that the UK exports to Europe that would be much affected by a strong pound, but imports from the rest of the EU, will certainly cost more. We've been trying to think of any large purchases we need to make in France in the near future, as there are bargains to be had if you are paying with Sterling at the moment.[/quote]

Thats what some just don't understand.

 

With 80% of UK cars build as LHD for export to the EU and most of them going to EZ countries they will be hit rather hard once the existing stocks in the EZ are sold. Education is another area that can be hit with EU/EZ students going to UK universities and language schools. This could be good news for Scottish universities as they are cheaper than English ones with regards to overseas students. At one time, for us mortals, the Euro reached parity with the pound (Dec 2008) and the EU coming out of recession after the crash helped UK exports as UK goods were very cheap to the EZ.

 

The average UK mortgage (May 2015) is £83k but there are a lot of people with £100k and bigger especially in the South of England. The 'planned' first interest rise will add an extra £160 (Guardian and Torygraph yesterday) per month to their repayments. Don't forget the bank rate is not the same as the mortgage rate with averages at 3.8% (May 2015). Not only will these interest rates start to hit house prices but will cost those that buy to rent as well. They might start to sell off some of their investments which will add more houses to the market which may force house prices down more. This in turn could reduce the amount of properties available for those that can only afford to rent.

 

Then we have UK unemployment which went up for the first time last month by 18,000.

 

On top of that the UK is lacking a lot of job skills with a report at the beginning of the year stating that as many as 75% of school leavers lacking basic job skills. Just the other day I saw on the C4 news that big companies want immigration laws relaxed and in particular work permit regulations which are both costly and take a long time to get.

 

Rise in interest rates coupled with the inability to find skilled workers could end up hitting small businesses very hard but time will tell on that.

 

There are some people of course who will benefit from the interest rises namely savers and pensioners. With the elderly, who were told to save, they should find they don't need to use so much of their capital savings and can start to use just the interest to supplement their pensions. Admittedly for many this is too little to late as their capital has almost gone. In the next couple of years we may also see annuities offered getting better although there won't be much change for those that bought their over the last five years at very low rates.

 

So whilst there is not much that the UK can do about exchange rates because that is out of their control rising interest rates might not be the brightest idea at the moment. Seems the UK goes three steps forward then two steps back but that’s nothing new.

 

[NickP]

Well the exchange rate is still going up.[:P]

[lindal1000]

Well all good for us and especially good for people living in the euro zone who get their income in sterling. Imports from outside the Euro zone will get more expensive but that will help those industries within the euro zone.

My siblings are both in positions where they had to get buy to let mortgages in Uk as they were forced to relocate due to work and couldn't sell their properties. They now have mortgages on two properties and a hike in interest rates will significantly affect their spending power. Now I could say that actually they have always spent too much and so maybe this is not a bad thing.. but in an economy that is based on high spending then you can see some of the risks and difficulties.

[powerdesal]

Contrary to the 40% export figure quoted above by Quillan, the actual percentage export to EU countries is close to 25%.

Germany (10 percent), France (7 percent), the Netherlands (6 percent) and Ireland (4.5 percent).

Other exports to the rest of the world via Rotterdam and Antwerp are classed as exports to the EU because they enter an EU country before being sent on to non-EU destinations.

The actual May 2015 figures are :-

Exports total 43047.00 GBP Million

Exports to EU 10904.00 GBP Million ( March 2015)

This gives a figure of 25.33%

[Quillan]

According to the FT exports to the EU support 4.2M jobs of which 3m are directly linked. Exports to the EU for the UK are valued at £211bn per year or £3,500 per head of population in the UK (I didn't do the math, I just copied the figures from the FT so feel free to check). The actual percentage of exports both in goods and services that I quoted it seems are old, it is now 51%. If however you remove the services the figure may well be what you have quoted. Where the goods go, be it through Rotterdam or not and export is an export and as long as you get paid who cares where it ends up but the point is we get paid from within the EU. In truth there are some even bigger figures out there if you google (and some lower as well) but I would tend to go more for the FT numbers or those from ONS (raw data not via a newspaper).

If the figure of £211bn is correct with the changes over the last four weeks in exchange rates the value has dropped by £6bn or in other words enough to built 11 new NHS hospitals.

[andyh4]

[quote user="powerdesal"]Contrary to the 40% export figure quoted above by Quillan, the actual percentage export to EU countries is close to 25%. Germany (10 percent), France (7 percent), the Netherlands (6 percent) and Ireland (4.5 percent). Other exports to the rest of the world via Rotterdam and Antwerp are classed as exports to the EU because they enter an EU country before being sent on to non-EU destinations. [/quote]

 

I keep seeing this quoted that exports shipped through another EU country are classed as EU exports, but I never see any proof that this is the case, or source for the information

 

If it is the case then reporting of exports has changed since I was responsible for it in my company.  End destination for the sale was always the key, and indeed it was essential to define this correctly because VAT had to be correctly allocated.  A sale to an EU country would attract VAT*; a sale outside the EU would not.  I cannot believe that UK exporters are c0cking things up and not getting nasty letters from the VAT authorities.

 

*  The VAT is usually recoverable, but is still due and has to be collected.

 

What did happen a lot was a sale to a trading company in the Benelux countries.  This is a sale to the EU since the customer is situated there and will be responsible for the VAT.  If the trading company then exports the goods outside of the EU, then that is his affair.  This is a totally separate sale.  It has nothing to do with UK exports to the EU, although I do accept that it means that the goods end up outside the EU.

[powerdesal]

The site from which I got my figures is :-http://www.tradingeconomics.com/united-kingdom/exports.

[andyh4]

Thanks for that Powerdesal.  It does seem that exports to the EU are only around 25% of all exports, although it does look from the data, that the data they use is for goods only and services and intellectual exports are excluded.  It does seem to suggest however that the 50% exports to the EU is a number to be challenged,

 

I could not however find any reference to the re-export of goods through the Benelux ports, which is what was irritating me (and continues to irritate as, if true, it is blatant misrepresentation).

[NickP]

Oh crikey what are we going to do we're all doomed, the pound has crashed down this morning from 1.44780 to 1.44720. What words of wisdom Walt, could you give me the benefit of your vastly superior intelligence and advise me what I should do? Shall I sell up in the UK and move permanently to  France, should I open a B&B? Buy a Citroen or a Peugeot, also should I join a French union before I move so as I can go on strike as soon as I arrive? I suppose I'd better start practicing throwing things at cyclists after all these British cyclists winning everything isn't fair on the poor old French is it?[:D][:P]

[Rabbie]

[quote user="andyh4"]

 

 

If it is the case then reporting of exports has changed since I was responsible for it in my company.  End destination for the sale was always the key, and indeed it was essential to define this correctly because VAT had to be correctly allocated.  A sale to an EU country would attract VAT*; a sale outside the EU would not.  I cannot believe that UK exporters are c0cking things up and not getting nasty letters from the VAT authorities.

 

*  The VAT is usually recoverable, but is still due and has to be collected.

[/quote] After asking for advice from HMRC I was advised that for exports to VAT registered customers in EU countries I should not charge them VAT but declare their VAT number and the amount being charged on a HMRC form that was submitted with the VAT return. Hope this clarifies the situation for you.

[andyh4]

Thanks for that Rabbie.  I knew the rules had changed some time ago, but since I was no longer responsible for the VAT/export declarations, I did not bother to keep up with the rules - a seemingly continuous exercise.  The point still remains, exporting out of the EU is handled differently to EU exports and messing it up causes a heap of pain with the VAT authorities - that has not changed.

 

 

Edited because my keyboard has decided to not transmit a number of characters

[NormanH]

[quote user="Chancer"]

For the first ever time I have a hedge against the currency movements by having income in both £'s and €'s but as the € income is currently 40% more then the £ income I would prefer the £ to be weaker, come la rentrée when I revert to long term lets if the exchange rate remains then I will have pretty much equal incomes from both countries.

I am now in the position of having too much money in my French current account which doesnt pay interest, it would be daft to transfer if to the UK altgough easy to do so, what simple interest bearing accounts are there in France? Something that has never been of any interest to me for a decade and comes as quite a surprise, not something I had ever considered or planned for.

[/quote]

As mentioned there is the Livret A but a slightly higher interest rate is paid on the LEP (Livret d'Epargne populaire )

http://vosdroits.service-public.fr/particuliers/F2367.xhtml

although see the conditions viz à vis income

[Quillan]

[quote user="andyh4"]

Thanks for that Rabbie.  I knew the rules had changed some time ago, but since I was no longer responsible for the VAT/export declarations, I did not bother to keep up with the rules - a seemingly continuous exercise.  The point still remains, exporting out of the EU is handled differently to EU exports and messing it up causes a heap of pain with the VAT authorities - that has not changed.

 

Edited because my keyboard has decided to not transmit a number of characters

[/quote]

 

From June 2015

 

http://researchbriefings.files.parliament.uk/documents/SN06091/SN06091.pdf

 

With regards to the Rotterdam Effect "Even if all trade with the Netherlands were excluded, the EU would still account for 42.5% of goods exports "

 

Data from ONS which says that whilst the Rotterdam Effect does exist the myth is about how much it impacts on UK exports to the EU which total, including the Rotterdam exports to 51%.

 

http://www.ons.gov.uk/ons/rel/uktrade/uk-trade/december-2014/sty-trade-rotterdam-effect-.html

 

The problem with newspapers and financial sites is they tend to lean towards figures to prove their point. The FT is a good source but going direct to the actual source i.e. ONS is much better and more reliable. Even the parliment research papers can have a slant towards who they are written for but then we knew that anyway.